High Yield Stocks From The S&P 500 With Very High Margins Researched By “long-term-investments.blogspot.com.” Profitability is very important. The higher the profit margins, the better the market position and market strength of a company.

However, I screened the popular S&P 500 index by high yield stocks with an operating margin of more than 10 percent. Eleven firms have such a high margin of which one yield at double-digit rates. Five have a current buy or better recommendation by brokerage firms.

Here are my favorite stocks:

Exelon Corporation (EXC) has a market capitalization of $31.46 billion. The company employs 19,267 people, generates revenue of $18,924.00 million and has a net income of $2,495.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $5,815.00 million. The EBITDA margin is 30.73 percent (operating margin 23.67 percent and net profit margin 13.18 percent).

Financial Analysis: The total debt represents 24.49 percent of the company’s assets and the total debt in relation to the equity amounts to 93.79 percent. Due to the financial situation, a return on equity of 17.86 percent was realized. Twelve trailing months earnings per share reached a value of $2.43. Last fiscal year, the company paid $2.10 in form of dividends to shareholders.

Gannett Co. (GCI) has a market capitalization of $3.55 billion. The company employs 31,000 people, generates revenue of $5,239.99 million and has a net income of $500.13 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1,012.42 million. The EBITDA margin is 19.32 percent (operating margin 15.55 percent and net profit margin 9.54 percent).

Financial Analysis: The total debt represents 26.61 percent of the company’s assets and the total debt in relation to the equity amounts to 75.62 percent. Due to the financial situation, a return on equity of 20.43 percent was realized. Twelve trailing months earnings per share reached a value of $1.69. Last fiscal year, the company paid $0.24 in form of dividends to shareholders.

Reynolds American (RAI) has a market capitalization of $25.47 billion. The company employs 5,400 people, generates revenue of $8,541.00 million and has a net income of $1,406.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $2,537.00 million. The EBITDA margin is 29.70 percent (operating margin 28.09 percent and net profit margin 16.46 percent).

Financial Analysis: The total debt represents 22.54 percent of the company’s assets and the total debt in relation to the equity amounts to 58.60 percent. Due to the financial situation, a return on equity of 22.04 percent was realized. Twelve trailing months earnings per share reached a value of $2.52. Last fiscal year, the company paid $2.15 in form of dividends to shareholders.

Take a closer look at the full table of the most profitable high-yields from the S&P 500. The average price to earnings ratio (P/E ratio) amounts to 22.10 and forward P/E ratio is 16.00. The dividend yield has a value of 6.35 percent. Price to book ratio is 1.79 and price to sales ratio 2.11. The operating margin amounts to 18.00 percent and the beta ratio is 0.97.

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